CBRE head of UK retail Phil Cann on the outlook for the fashion retail property market.
The retail market, as a whole, continues to perform positively. With employment levels still rising and an increase in real wage growth, consumers are benefiting from more disposable income.
There is also more stability following the general election and retailers will need to adapt to changes announced in the post-election budget. While the introduction of the national living wage has seen mixed reactions from retailers, on balance it appears that most view this as a progressive measure for workers that will feed through to retailers via increased consumer spend.
Possible changes to Sunday trading hours in England and Wales are also expected to deliver benefits to retailers, provided that legislation ensures local authorities do not pick and choose which areas of their catchment will be eligible.
Most view the living wage as a progressive measure for workers that will feed through to retailers via increased consumer spend
The economic upturn, which has, at last, surpassed pre-recession levels, continues to be good for retail. This is evidenced not only through strong trading and profit results from Zara and Next but the continued entry of new retailers to the UK. In this Drapers Property Special we focus on one new entrant, value chain Pep&Co, which will trade from 50 UK shops by the end of 2015.
We also discuss the continued success of UK outlet centres, which have evolved from being largely clearance centres for surplus inventory to vibrant and exciting destinations that people visit for a luxury retail experience.
As retailers continue to capitalise on a now truly global retail market we explore Australia, which has seen an influx of foreign retailers in the past few years, all looking to capitalise on its strong economy, young demographic and global tourist market.
Sydney’s prime shopping district is now one of the most expensive in the world and with H&M recently opening one of its largest global stores in Melbourne the country is cementing its position as a strategically important region.
As we look forward, we continue to see a positive market ahead for UK retailers and a continued need for them to compete at a global level as they seek to develop their brands.